A new platform for Whole Foods? How deal could upend grocery

Amazon website Amazon acquires Whole Foods marketplace

Amazon homepage

Experts say the company is betting big on a small, but growing industry. Simply adding a grocery store such as Whole Foods isn't going to deter most shoppers from the warehouse giant.

For starters, the move helps Amazon expand into an industry that has eluded them for some time. It provides the world's largest cloud infrastructure, its television shows have won 11 Emmys in two years, it's a global leader in tablet sales (behind only Apple and Samsung), its work in artificial intelligence is competitive with Google and IBM, and it operates the world's most-watched live video streaming service (Twitch). While the market in general wasn't fazed by this news, many grocers and other retailers were. The White House did not answer an email I sent asking about the president's campaign statement and what it might mean for the Amazon-Whole Foods deal. Furthermore, there is a great opportunity for Amazon to cross-sell to the Whole Foods customers more frequently and with greater ease as a result of this acquisition.

Amazon announced on Friday, June 16, that it will be acquiring Whole Foods (WFM) for $13.7 billion, in an all-cash deal. What are the consequences of Whole Foods's acquisition for food retailers worldwide? He said he expects Amazon will eventually reconfigure Whole Foods stores, and landlords and developers will have to adapt.

Like Walmart, Amazon is a master of wringing out costs. The drop in grocer share prices the day the deal was announced - No. 1 US grocer Kroger fell more than 9 percent - demonstrates the threat investors feel Amazon poses to traditional grocery chains.

"All stores are not going away, it's just a matter of finding the store/online equilibrium", Credit Suisse analysts said in a note.

"There could be a lot of that market up for grabs with a better experience and value", he said. No longer can grocery stocks rely on volume to make up for thin margins.

Inc.'s path to acquiring Whole Foods Market Inc. looks clear. Whole Foods recently launched its 365 chain - with several planned in the Atlanta area - to compete with middle-tier grocers slicing into its niche of higher margin organic and free-range products.

Mother's hot auto lesson ends in kids' deaths
Huffman and a person who answered the phone at the Parker County jail had no information about whether she had an attorney. The investigators involved in the case believe Randolph was exclusively responsible for the death of her two children.

The question for many other grocery stores might wonder if they're perishable.

Most Amazon watchers are focused on the some 450 stores the e-commerce behemoth scoops up in the deal.

According to a report this month by CBRE Research, online food and beverage sales - of which groceries are the biggest part - made up only 0.1 percent of all retail sales or about $1 billion in 2015.

Walmart, which gets more than half its revenue from groceries, has been expanding with its acquisition of Jet.com past year and last week said it was buying online men's clothing seller Bonobos.

Omnichannel dominance will require physical stores, CBRE said, "giving the initial advantage to those players with a wide existing store network".

Maybe, but the "Bezos Effect", the boss's legendary Midas touch, helped turn the Whole Foods deal into gold in less than a day. It is now becoming a key piece of Amazon's long-term focus; after all, food is a $700-billion sector in the USA, and nearly $120 billion in Canada. While Forrest doesn't shop exclusively at Whole Foods, he said he makes it a point to get items like vegetables and meats from the chain.

However, Meyer is interested in seeing whether Amazon, through its ownership of Whole Foods, can find a way to use its distribution system to deliver perishables like cottage cheese.

Senate panel seeks details on Lynch role in Clinton probe
Chairman Grassley then requested a copy of the document from the Justice Department, which has failed to respond. Lynch has denied knowing or talking to the person to whom she allegedly gave this assurance.

Wiesel, the analyst, said Amazon has been trying to crack the grocery code for years with only varied success. "Today you go onto Amazon and filter everything by what's Prime".

If Amazon wants to become the 'The Everything Store', then this acquisition is a masterstroke.

Yet if there's one thing to learn about Jeff Bezos, Amazon's founder and chief executive, after years of watching Amazon, it's that he doesn't spend a lot of time predicting future possibilities. So far, it's in the testing phase in Seattle and only available to employees. They do services of various sorts, but it is unsettling, isn't it, to think of one huge company. It's all linked by a smartphone app.

Amazon's size and reach gives it the ability to beat most competitors on price. 'Whole Foods Market has been satisfying, delighting and nourishing customers for almost four decades - they're doing an unbelievable job and we want that to continue.

Space saved could be devoted to specialty goods and prepared meals popular with millennial shoppers.

"To me this is yet another layer of experiential retail that can go anywhere", he said.

Both Amazon and Whole Foods cater to younger consumers, including millennials, as well as more affluent shoppers.

Federer reaches 11th Halle final after beating Khachanov
Mayer and Zverev may have the backing of the German fans in Halle , but Federer can never be counted out. Mayer , who won the title previous year , ousted Lucas Pouille in three sets.

Latest News